# Internet Sales Tax Bill



## denarok (Aug 10, 2009)

Internet sales tax bill divides Republicans, vote looms in Senate | Fox News

It been a while since I been here but I saw this and has me concerned not even just for buying cigars but in general.

If this goes into effect then it looks like famous smokes, and CI will have to start collecting tax say since I am in NY, the NY tax of cigars and then send it back to the NY state.

Which will really suck because then I can no longer afford to buy cigars too much.


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## Livin' Legend (Sep 23, 2012)

"Look, the economy is kinda sorta picking up again. Let's see how hard we can poke it before it collapses again!"


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## Griffin2020 (Nov 11, 2012)

This bill, should it pass fully will be the death of the small Internet retailer. Not just of cigars, but in general. 
Large companies already charge taxes (if they have a physical premises in the state), so it will not affect them.


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## Wicked_Rhube (Jul 29, 2012)

I believe (please correct me if I'm wrong) that this is for "sales" tax, not tobacco tax, meals tax, excise tax, tanning bed tax, etc. If that is the case then I will end up paying an extra 6.25%, which won't kill me since CI, Famous, et al are so much less than I'd pay locally in MA. If this includes the tobacco tax though, I might go join a militia or something!!!


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## Livin' Legend (Sep 23, 2012)

To be fair, there's apparently an exemption for retailers who make less than $1 million per year, so if anything it might help the micro retailer a bit. What it doesn't help at all is consumers. They can argue all day long that we were actually required to pay sales tax all along, but the fact is we'll be paying something we didn't pay before, and the added cost of what you just know will be a pain in the nuts process of calculating and paying all these taxes will result in raised costs and higher prices. I'd be interested to know how many companies make just over $1 million who would be severely affected by this new money grab.


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## Griffin2020 (Nov 11, 2012)

Really it is all the more reason to support your local privately owned B&M.


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## huskers (Oct 2, 2012)

Wicked_Rhube said:


> I believe (please correct me if I'm wrong) that this is for* "sales" tax, not tobacco tax, meals tax, excise tax, tanning bed tax, etc*. If that is the case then I will end up paying an extra 6.25%, which won't kill me since CI, Famous, et al are so much less than I'd pay locally in MA. If this includes the tobacco tax though, I might go join a militia or something!!!


I'm not sure what your talking about Rhube. You will now be paying sales tax for most everything bought ONLINE.

Rather it be shampoo, dog food or cigars.

Some companies didn't collect it before and it was up to the individual to report it in come tax season. People weren't reporting it in so the states decided that in order to get their money, they will just force companies to charge the consumer tax to make sure the state gets it tax money.


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## DarrelMorris (Feb 7, 2012)

Griffin2020 said:


> This bill, should it pass fully will be the death of the small Internet retailer. Not just of cigars, but in general.
> Large companies already charge taxes (if they have a physical premises in the state), so it will not affect them.


Personally, I think this is the primary reason for this legislation. The States want their tax money but I'd be willing to bet that the real power behind it is the large retailer. Large retailers have been whining about online competition for years. They'd rather legislate the competition out of business than actually become competitive.


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## Griffin2020 (Nov 11, 2012)

DarrelMorris said:


> Personally, I think this is the primary reason for this legislation. The States want their tax money but I'd be willing to bet that the real power behind it is the large retailer. Large retailers have been whining about online competition for years. They'd rather legislate the competition out of business than actually become competitive.


Agreed. Rather than deal with competition, get your political cronies to legislate your competition out of business.


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## edwardsdigital (Mar 18, 2013)

Do we have any billionaires here that want to poke at (BUY) some of the legislators so this doesnt go through??? I mean, isnt that how our wonderful Government works anyway?


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## Wicked_Rhube (Jul 29, 2012)

huskers said:


> I'm not sure what your talking about Rhube. You will now be paying sales tax for most everything bought ONLINE.
> 
> Rather it be shampoo, dog food or cigars.
> 
> Some companies didn't collect it before and it was up to the individual to report it in come tax season. People weren't reporting it in so the states decided that in order to get their money, they will just force companies to charge the consumer tax to make sure the state gets it tax money.


I get all that, I was simply relating it to cigars and stating that it will only be a 6.25% increase for me, still several dollars per smoke less than buying in the Peoples Republic of Massachusetts, where a tax specifically on cigars could still be skipped by buying online.


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## Wicked_Rhube (Jul 29, 2012)

DarrelMorris said:


> Personally, I think this is the primary reason for this legislation. The States want their tax money but I'd be willing to bet that the real power behind it is the large retailer. Large retailers have been whining about online competition for years. They'd rather legislate the competition out of business than actually become competitive.


I disagree, as large retailers are just as online as anyone else IMO.


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## bundy81881 (Apr 2, 2013)

Is this something that will tax transactions across state lines? I haven't quite been able to get a straight answer on this. Or will it just tax for transactions in your state if you and the seller are in the same border?


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## Wicked_Rhube (Jul 29, 2012)

bundy81881 said:


> Is this something that will tax transactions across state lines? I haven't quite been able to get a straight answer on this. Or will it just tax for transactions in your state if you and the seller are in the same border?


My understanding:
Currently a retailer must collect sales tax for online purchases if and only if that retailer has a brick and mortar establishment in the state where the sale occurs. So take Famous or CI, both in Pennsylvania right? If I buy cigars from them they do not charge me sales tax because I live in Massachusetts and they do not have a shop / office / warehouse in my state. Take Amazon for another example, if I buy my kid a toy through them I pay no sales tax because Amazon has no B&M establishment here either.

Once this law goes through Amazon will charge all online purchase the sales tax according to the state where the purchaser is. All retailers with over a million dollars of sales annually will now be required to collect the sales tax for each state, regardless of where the retailer is located.

They say this will "level the playing field", as if the sales tax is the only or major thing making life tough on brick and mortar retailers. I have no problem with the states collecting what is theirs (ours), but I think this is not the big answer to saving mom and pop shops across America. Look at it this way; if I need / want to buy a $100 item I can buy it online and even with sales tax it will cost me $106.25, I'm an Amazon Prime member so I'm getting free shipping. lets say I could drive to a local store and buy it for the same price (not likely taking economies of scale into account) and it costs me $106.25, but I also drove 10 miles each way, which in my F-150 at $3.59 a gallon costs me more than if I just order it online. There are a s#!t ton of variables that are hurting the main street shops around all of us, and in my opinion collecting internet sales tax will do little to cure their ills.


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## edwardsdigital (Mar 18, 2013)

@Wicked_Rhube I agree completely with your train of thought on this one.


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## DarrelMorris (Feb 7, 2012)

bundy81881 said:


> Is this something that will tax transactions across state lines? I haven't quite been able to get a straight answer on this. Or will it just tax for transactions in your state if you and the seller are in the same border?


It is designed to tax across state lines. Currently they are only required to collect sales tax if the buyer and the seller are in the same state. Legally the buyer still owes it, but the seller doesn't have to collect it in interstate transactions.


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## DarrelMorris (Feb 7, 2012)

Wicked_Rhube said:


> I disagree, as large retailers are just as online as anyone else IMO.


They are. They aren't very good at it though. They stick to outdated business models and pricing structures. They don't object to online sales, they object mostly to more streamlined businesses that can sell for less, because they don't have a huge expensive infrastructure and aren't paying their top executives ridiculous salaries. This is of course a generalization. There are some large retailers that do not fit this description.


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## Tobias Lutz (Feb 18, 2013)

Wicked_Rhube said:


> They say this will "level the playing field", as if the sales tax is the only or major thing making life tough on brick and mortar retailers. QUOTE]
> 
> This is what I see being the major problem surrounding this issue- they are BSing something that doesn't need to be BSed. In other words they should call a spade and spade and simply say that states are trying to get the sales taxes that are rightfully theirs in order to maintain there revenue. I'm not sure why it needs to be dressed up as something it is not. The only thing I can think is that people recoil at the idea of any additional taxation but it doesn't occur to them that this will simply offset an increase in their state's income tax (for the time being at least).


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## Griffin2020 (Nov 11, 2012)

It seems to me that this would fit somewhere in the legislating interstate commerce clauses in much the same way that the (so-called) Affordable Healthcare Act does, and should therefore be unconstitutional (in the same way).


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## Anthony Johnson (Jan 23, 2007)

My son wanted to buy a ps3 video game online a few weeks ago, and asked me about the tax. I told him there is no online tax, but give em time. That was some interesting timing... All though I'm fiscal conservative, a lot of online base companies have been getting away without having a store front and so many extra bills it's not funny. What kills it for the consumer, is the fact of shipping rates being as high as it is. It's all passed down to the consumer either way. Lucky for me, I have a Jr's Mega store 20 minutes down the road! :woohoo:


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## djsmiles (Aug 4, 2012)

On cigar related topic, this will not bode well for me. You can say, "Well, just support your local B&M!!!" My local B&M is 45 minutes away. And doesn't carry all my favorites. I have to go online for that. 

This bill will put many small online retailers out of buisiness due to the sheer amount of paperwork and the confusion of tax codes and CPA's. Not to mention Interstate Commerce.

The .gov is over-reaching. They need to stop.


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## DarrelMorris (Feb 7, 2012)

Anthony Johnson said:


> All though I'm fiscal conservative, a lot of online base companies have been getting away without having a store front and so many extra bills it's not funny.


While there are some online companies that have very little overhead, many of them have huge overhead. They have warehouses and shipping facilities that cost much more than a simple store front would cost. Some even have a store as well. We need to support our local stores, but let's remember that many of the online cigar shops have stores and provide jobs too. The retail business model has changed. Traditional retailers are going to have to figure out how to compete or get left behind. I'm sure that all of the Mom and Pop general stores went through the same thing when Sears first opened and started their catalog sales, changing how America shopped. Now the big retail giants are facing their own challenge. We don't all have to like it, but we might as well get used to it.


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## Bruck (Jan 8, 2013)

Interesting discussion y'all.

Here's the problem as I see it - the "micro" effects are going to have a big "macro" effect. The thing that keeps our economy going, such as it is, is discretionary purchases, i.e., buying things/services bcs we _want_ them, on top of the things we _need_. This is going to add a little more to the cost, 4% to 9% approximately, so it's going to make us think just a bit more before we buy. And so we're going to buy less, period. B&Ms are not going to see an increase in sales, and online sellers are going to see less. Slower economy, fewer jobs, less overall revenue for state gov'ts. We're on the wrong side of the Laffer curve.


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## Griffin2020 (Nov 11, 2012)

Bruck said:


> B&Ms are not going to see an increase in sales, and online sellers are going to see less. Slower economy, fewer jobs, less overall revenue for state gov'ts. We're on the wrong side of the Laffer curve.


Not sure you can completely discount a move to smaller (mom and pop type) B&M establishments.

I agree that we are or are moving to the wrong side of the laffer curve, but cannot necessarily correlate an Internet sales tax to that issue. 
The more the gubbmint tries to tax the higher earners (and job creators) the more we will see them expatriating themselves and their revenue to one of many places that are more friendly to them and their pocketbooks (Belize, Nicaragua, Bahamas, etc).


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## soxnationsmoker (May 1, 2013)

Not to jump away from the "cigars being taxed" discussion but I run 3 VERY successful Ebay stores and currently am only required to collect tax from my fellow Michigan buyers. I have 2 large warehouses and there is a lot of overhead in my business. If they require us to start collecting / paying sales tax for each and every sale it will be nothing short of a headache. I agree with most that have posted under this topic that as usual the government is stretching that already oversized hand into the small guys pocket even more. :banghead:


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## Griffin2020 (Nov 11, 2012)

I am curious as to whether this will exempt resale items, or if they will be trying to double-dip by taxing in that arena (like is done with automobiles)


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## Bruck (Jan 8, 2013)

Y'know, the thing I find interesting about the "leveling the playing field" argument, is that nobody is saying let's lower sales taxes for B&Ms.


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## RJ-Harder (Apr 23, 2013)

Here I was thinking that I already was paying sales tax online. I guess since I'm Canadian I have to pay it because when it crosses the border they apply the gst and pst. When it's only shipped across provinces maybe I don't have to pay it. Dunno the last time I bought something online from canada...


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## Tobias Lutz (Feb 18, 2013)

I have not seen where anyone is trying to head in this direction but try not to say that too loudly since you don't want to give anyone ideas


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## Wicked_Rhube (Jul 29, 2012)

Griffin2020 said:


> I am curious as to whether this will exempt resale items, or if they will be trying to double-dip by taxing in that arena (like is done with automobiles)


Oh you know they will double-dip that chip!


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## Tobias Lutz (Feb 18, 2013)

Wicked_Rhube said:


> Oh you know they will double-dip that chip!


this

:biggrin:


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## Griffin2020 (Nov 11, 2012)

Tobias Lutz said:


> I have not seen where anyone is trying to head in this direction but try not to say that too loudly since you don't want to give anyone ideas


I have actually heard several people reference this.
The screaming over this is now being drowned out by the renewed screaming over the fiasco that is (was) Bengazi, and the IRS's persecution of any non-profit organizations that want to educate people on the Constitution and advocate for smaller government....

More and more justification to pack up and head south...I hear Nicaragua is beautiful at this time of the century...


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## Tobias Lutz (Feb 18, 2013)

I should clarify. I was trying to quote the post that asked about the sales tax being applies to used goods as well. Mistakenly hit the wrong button. I can't say I would argue with living closer to the fine individuals who roll my cigars however :biggrin:

Screw a humidor, you could get them fresh from the factory.


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## MarkC (Jul 4, 2009)

Griffin2020 said:


> I have actually heard several people reference this.
> The screaming over this is now being drowned out by the renewed screaming over the fiasco that is (was) Bengazi, and the IRS's persecution of any non-profit organizations that want to educate people on the Constitution and advocate for smaller government....
> 
> More and more justification to pack up and head south...I hear Nicaragua is beautiful at this time of the century...


I'll tell you the same thing I tell those on the left who talk about packing up and heading to Canada: don't let the door hit yer a$$ on the way out.


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## Griffin2020 (Nov 11, 2012)

MarkC said:


> I'll tell you the same thing I tell those on the left who talk about packing up and heading to Canada: don't let the door hit yer a$$ on the way out.


And I will reply with this:

[Political Rant]
I am a proud and patriotic American. I served my country in the Navy, and it breaks my heart to see what the politicos (on BOTH sides of the fence) are either causing or allowing.
It angers me that the IRS was allowed to be or was intentionally used as a political inforcement tool.
My blood boils at the fact that the administration does not care that an act of war was committed against it through the murder of four official delegates last September in Bengazi.
And I am disgusted that the Department of (in)Justice felt the need to tap the phones of the journalist corps with a hypothetical subpoena (that nobody has seen).

The government seems to have forgotten that their power is granted to them by the people and for the people.
[/Political Rant]

An extended vacation may be due, and the beauty and the fact that cigars and coffee are grown and produced in Nicaragua is just bonus.


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## MarkC (Jul 4, 2009)

Bull. Someone who wants to cut and run has no claim to the word patriot. This country has problems; always has and always will. Those who care about the country work to solve them.


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## Griffin2020 (Nov 11, 2012)

What gives you the right to question my love of my country?

I have been all over the globe in service to a government that no longer seems to care what the citizens think on whatever issues, but bends over backwards to serve to illegal aliens- oh, wait, you can no longer call them that- the "undocumented workers. 
No other country on the planet is as lax on the issue of illegal immigration as we are.


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## MarkC (Jul 4, 2009)

I apologize, Jack; I should have never made the post. It's not like you're the first person to post something along those lines here, you just happened to be the one that posted it at a time when I was ready to snap.


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## Griffin2020 (Nov 11, 2012)

Thank you.


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